Number 1. Sustainable profits is the best indicator of a great investment. If a company has been profitable for the past thirty years, with no more than one or two unprofitable years, you have likely identified a stock that is a conservative dividend investment.
Number 2. Don’t worry if your stock does not go up right after you buy it. When the company pays out a dividend, it can be reinvested at a lower price and then you will look back on it years later and be glad that the price was lower because it meant that you acquired more shares than would have otherwise been the case if the stock price rose … Read the rest of this article!
When you look at the stocks sitting there in your portfolio, do you think: (1) I need to diversify more, (2) I need to own higher quality companies, (3) I need higher current income, and/or (4) I need to own companies that have better earnings per share growth rates. If those thoughts dominate when you size up your portfolio, it probably makes sense to pool your dividends together and make opportunistic investments that can alleviate that concern.
Want something higher-quality? Take your dividends and add some Procter & Gamble, Johnson & Johnson, or Coca-Cola to your portfolio.
Need higher current income? Take those dividends and buy GlaxoSmithKline, AT&T, or BP.
Need higher earnings … Read the rest of this article!